I’ve warned that the CFA and other degrees and certifications can be massive time sinks, but language study could easily fall into this category as well.

The last time I looked at the “Which language should you study?” question, I gave a non-answer and said, “Improve your communication skills in English.”

While that advice is still true today, it’s not universally true.

There are some cases where you can gain a recruiting advantage from proficiency in another language.

So I’m going to cover those cases here, and then give a real, specific answer on the most useful language for finance roles (hint: Spanish).

What *Hasn’t* Changed?

In the original version of this article, I made the point that language study is mostly useless for recruiting purposes unless you reach a very high (near-native) level.

Passing a “proficiency exam” with 90% of the answers correct doesn’t mean much because you can’t give a client 10% incorrect information.

It will be almost impossible to reach a level where you can “speed read” in another language, but you often need to do that in IB/PE roles (when reading information memoranda, for example).

Also, most banks outside the Anglosphere greatly prefer to hire native speakers of the local language who are also proficient in English.

Just ask anyone from a Western country who wanted to “study Mandarin” and then “go work in China.” Oops.

So assuming you already speak English proficiently, you are usually better off combining language study with a study-abroad experience and using it as your “interesting fact” in interviews instead.

So What Has Changed?

But there have been a few changes over the years, which prompted me to write this article.

First, English has become even more dominant at multinational companies, even in countries like Japan that traditionally have low proficiency levels (see: Honda and Rakuten).

So if you are not a native speaker or you haven’t been learning from a very young age, you will benefit the most by improving your English skills.

Another change is that emerging markets haven’t lived up to their promise.

Back in 2005 or 2010, people argued that the importance of other languages would increase because thousands of new banks and finance firms would spring up in Brazil, China, Russia, India, and other places.

But that hasn’t exactly happened if you look at 2015 M&A deal activity by region (Source: Dealogic):

China has performed better than the others (hence the rise in Asia ex-Japan deal activity), but most of these places still have relatively small financial markets.

Finally, it is becoming less feasible to master another language even as a university student.

You now need a series of internships to have a good shot at a penultimate-year internship that leads to a return offer, so it’s not realistic to spend two summers studying abroad and then suddenly get into investment banking.

This Question is Mostly About Your Age and Region

Before answering the question of which language is most useful, you need to reframe the question:

Are you at an age and in a region where another language could be useful without taking an inordinate amount of time?

If you’re already about to graduate from university, or you’re well beyond university, there’s no point in learning a language to boost your recruiting chances.

You won’t have the time or motivation to reach the required proficiency level, and your work experience will matter a lot more than other skills at that point.

Similarly, you won’t gain a huge advantage if you’re planning to live and work in the U.S. because most deals are domestic and require nothing besides English.

So you gain the biggest advantage from another language if:

You’re young – you’re not even in university, or you just started.

You’re planning to live or work in London (or should this now be “Europe”?) or another region where knowledge of other languages can significantly boost your chances.

Outside of Europe, other languages probably help the most in Latin America.

In Asia, most markets tend to favor local candidates who are native speakers; I’ve heard very few stories of readers learning East/Southeast Asian languages and then using them to win offers.

How Do You Judge the “Usefulness” of a Language?

Given the constraints above, the list of languages useful for recruiting purposes is different from the “general purpose” list.

Here are the criteria I used:

Point #1: How Long Does It Take to Learn/Master?

If one language takes 500 hours to learn and another takes 2,000 hours, it’s really hard to make the case for the 2,000-hour one in today’s recruiting environment.

So all else being equal, it makes more sense to study languages that are closer to English.

People often claim that grammatical similarities explain the ease or difficulty of other languages, but I believe vocabulary is the biggest factor: if 75% of the words are similar to words you already know, memorization time drops substantially.

Point #2: How Widespread is the Language, and How “Necessary” Is It?

You can’t just look at a list of languages by the number of speakers worldwide and go by that because some languages are used in only 1-2 countries (Mandarin, Japanese…).

Also, sometimes you don’t need to know the language to work in the region because English is used for business (the Middle East and India).

By contrast, it would be almost impossible to live and work in some places, such as Latin America, without knowledge of the local languages.

Point #3: How Many Qualified Native Speakers Are Competing with You for Jobs?

Firms almost always prefer to hire local candidates, but in some regions, it’s more pronounced than in others.

Sometimes the “supply and demand” of candidates are way out of balance, making it much easier for you (Mexico) or much harder (China).

You’re much better off going to markets with rising, unmet demand for candidates rather than ones that are flooded with them.

The Rankings, Please

Based on this criteria, Spanish is the clear winner for the most useful language.

That’s because:

It’s almost certainly the easiest language to learn if you already know English.

It’s useful in Latin America, the U.S. (see: Miami or LA), and Europe.

Portuguese has many of the same advantages as Spanish: it’s fairly close to English (though a bit more difficult than Spanish), it’s essential if you spend any amount of time in Brazil, and at times in the past there have been imbalances in the talent demand/supply.

However, I would still give the edge to Spanish because it’s more widespread and more useful in the U.S. and Europe.

German, French, or Italian

These are the most useful languages if you plan to work in Europe, and they’re all more similar to English than Asian or Middle Eastern languages.

However, I’ve seen little evidence of foreigners learning one of these languages, going to the country in question, and then winning job offers there.

Ironically, these languages probably help you the most if you’re from the U.K., you want to work in London, and you need something to compete with continental Europeans applying for IB roles there.

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street. In his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Sauron.

Good afternoon,
What are the prospects of a Credit Analyst, which is a “middle office” or “support team” role, looking to break into IB?

Depending on the firm and or who you talk to, Debt Solutions/Lev Fin, M&A, Infrastructure could be a good fit.

I have also heard (in many quarters) that Credit Analysts tend to excel in client facing roles (although this might depend more on the individual). There also seems to be a large amount of modeling, analysis and presentation work involved which could help futher an individual’s case.

I have been cold-calling/emailing and sending our my applications for M&A intern position here in Germany and most of the time I hear back with with responses somewhere along these lines of “You’re certainly qualified as you have these outstanding bla bla bla’s and we’d love to invite you for the interview as we’ve done for the candidates with similar profiles like yours … but we categorically set the German language proficiency requirement at ‘business-professional’ since we conduct majority of our business in German language.”

I am an international student studying MSc Finance in Germany and I believed I spoke “Nearly Fluent” German. I have another year to go (plus 1.5 year extra) having lived here for a year now. I’m certain even Native speakers, unless they specifically studied Business/Management related subjects in German language, would not know the German vocabs. that come up in Financial Modeling, Due Diligence et al. I’ll certainly give my best to pull it off for my love of the culture, but seriously, for an internship/analyst role, “Business-professional?” Mein Arsch! Verpiss dich!Time for London!

Thanks for sharing, and sorry to hear about that. Your story is one example of why European languages tend to be more useful for roles in London than in the actual countries that use those languages. I have yet to see a great example of someone who moved to Germany or France, learned the language, and then won a full-time role at the bank using it (but please, if you’re out there, reach out and let me know!).

1) I think it really depends on where, specifically, you want to work. If you want to stay in Poland or go to the U.K., it’s not worth improving your existing language skills. But if you want to work in Spain or Latin America, yes, it’s worth it to improve your Spanish. I think German is arguably worth it as well, but my understanding is that it’s tough to win full-time roles in Germany as a foreigner (though internships are possible and don’t require as much language ability).

2) For off-cycle internships, it is mostly about sheer effort and how many firms you can look up and cold email. There are so many banks and small investment firms in the U.K. that your chances are much better if you target places there. To go from Investor Services to IB, I would probably spin it as “experience working at Major Bank X, and I’m now seeking experience in investment banking” so that you’re not saying upfront exactly what you did.

Just a suggestion to all of those people who are struggling to define “fluency” vs “conversation fluency” etc. Go get tested. Get a score. Each language will sometimes have its own score and test system.

That way if you wish, you can put “Standard Chinese – HSK Level 5” on your resume instead of “conversationally fluent.” (Calling it Mandarin is actually incorrect, but I won’t get into that here. For Chinese you can take the HSK, BCT, or OPI depending on your goals.)

To give you an idea of the time commitment to go from zero to being able to have a 20-minute conversation with minimal error and to read a newspaper, the below is what it takes from an English speaker’s viewpoint:

Now add on what it takes to learn how to say “subordinated note” in that language. Nothing worse than someone who claims fluency and then has to walk it back and caveat it to make it seem like he or she never made that claim. Decide for yourself if that time is wisely spent attempting to learn those languages or if you put in 2,000 hours following Brian’s guides and methods to get you the job you want. Be that studying for the GMAT, etc.

Valid point about the hours to learn languages, but I have to disagree about the benefit of listing tests for a few reasons (they are of course useful).
1. There are many people who can study a language in schools and pass fluency tests, but when you put them in front of a client within finance, your ability to describe a picture will not help explaining a the benefits of a reverse merger.
2. The example you showed here of HSK tests is only useful for someone who studied the language and returned to their home country. Working in the industry, I can tell you that 90% of people working in large Chinese Banks have no clue what an HSK test is. Its not that it isnt useful, its just that the test isnt widely known to local Chinese.